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Old 05-22-2015, 10:21 AM
 
Location: Brooklyn, NY
122 posts, read 192,299 times
Reputation: 46

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Hi everyone!

I was searching coop apartments for sale on zillow and found that there are several apartments in Marine Park area in Brooklyn going for 150K-200K. However, the HOA fees for these apartments are up to $1000 and include utilities and taxes. I walked around the area just because I was curious and these apartment buildings come with nice playground for kids and areas for folks to hang out and at least the outside seems neat and nicely maintained. Would you say this is too much? I might be able to afford a purchase up to 200K apartment and could see myself paying off the mortgage in 15 years but I'm not sure if HOA fees are worth it.

Thank you!
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Old 05-22-2015, 11:11 AM
 
64,666 posts, read 66,158,228 times
Reputation: 43093
hoa fees are not the same as co-op maintenance fees , which is it ?
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Old 05-22-2015, 06:17 PM
 
3,502 posts, read 1,797,634 times
Reputation: 1630
In my (humble) opinion, it's not worth it.
In fact, I'd rather have a more expensive apartment and lower maintenance or HOA fees.

The mortgage eventually gets paid off.

But maintenance/HOA fees are every month, forever, and will keep going up.

Who wants that high payment hanging over their head for the rest of their life?
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Old 05-22-2015, 07:06 PM
 
1,099 posts, read 1,064,909 times
Reputation: 366
Quote:
Originally Posted by Shoshanarose View Post
In my (humble) opinion, it's not worth it.
In fact, I'd rather have a more expensive apartment and lower maintenance or HOA fees.

The mortgage eventually gets paid off.

But maintenance/HOA fees are every month, forever, and will keep going up.

Who wants that high payment hanging over their head for the rest of their life?
Correct, only worth it if you can pay off mortgage quick and sell it.
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Old 05-22-2015, 07:28 PM
 
Location: Brooklyn New York
15,231 posts, read 23,764,219 times
Reputation: 19861
Co-Op's do not have Home Owners Association fees.
It is called maintenance.

Your maintenance payment includes real estate taxes and water and sewer. It also includes repairs for the building.

The maintenance is 50% tax deductible at the end of the year, you will also be entitled to the STAR tax relief program, which in my case gives me a tax credit every December which allows me to live free for the month of January and only need to pay half of my maintenance payment for February.

My co-op has been paid off more than a decade ago.

HOA's is for houses in a development, we do not have them here in NY. They are more down south, not here.

a condo usually has lower maintenance, often called common charges, while a co-op is more but the apartments are cheaper.
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Old 05-23-2015, 04:25 AM
 
64,666 posts, read 66,158,228 times
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the op is confused and does not clearly understand the difference. we can't comment until we know if it is a co-op or a condo . a co-op has no hoa fees .
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Old 05-23-2015, 06:03 AM
 
Location: Manhattan
20,147 posts, read 26,435,766 times
Reputation: 9029
Quote:
Originally Posted by mathjak107 View Post
the op is confused and does not clearly understand the difference. we can't comment until we know if it is a co-op or a condo . a co-op has no hoa fees .
Yep,

We are all patiently waiting for loss4words' reply.
(Screen name might be apt?)

Sometimes a co-op's maintenance charge even includes electricity and it almost always include heat and hot water which is a BIG plus. Same cannot always be said of condos.
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Old 05-23-2015, 07:42 AM
 
Location: Chicago
5,559 posts, read 3,475,317 times
Reputation: 2181
Hi,

It is not important what you call it, the bottom line is make sure you understand what you are buying, what you are getting, and what rights you are getting and losing when entering into any real estate transaction. For me, the absolute worse form of transaction is the coop arrangement because of what you get and what you lose. This explains the low cost of buying into a coop.

The easiest way to understand this is to look at each form of real estate transaction. Renting gives you a lease (permit) to occupy a space for a period of time. It may or may not include the landlord's assumption of certain utility and maintenance costs. This is all spelled out in the lease. You can leave any time the lease expires. Very simple.

The second easiest to understand is single family and multi-family ownership where you buy title and deed to a property, usually but not always including the land. It is important to understand you actually own something. You assume all responsibilities for owning and maintaining the property.

After this it gets tricky. With condos you own and receive title and deed to a property (which is recorded) but at the same time you enter into a partnership with other property owners and with this partnership agree to share in the responsibility of maintenance and care of common elements. This partnership is called an association and it elects a Board that governs (in most cases rules over) the association often times like a dictatorship. Like all partnerships, this shared responsibility is rife with problems caused by a) owners that don't participate or reneg on responsibilities, b) owners to co-opt governance authority and begin to use their authority in ways that are not aligned with the overall well being of the property, c) owners of unequal economic means who are unwilling or unable to maintain the property properly, d) owners with questionable or naive business judgement, etc. As with coops, condo owners have very little legal protection, but at least they can sell with BOD approval since the actually own the deed to the property.

Last but not least there is the coop, which is a glorified timeshare arrangement. Just like renting, you have a long-term lease to occupy a space. The loan that a coop shareholder has with a bank is basically used to pre-pay rent for 30 years. The shareholder owns no property. The owner is the corporation which is governed by the Board of Directors. The BOD decides everything. If you want to sell your lease (your shares), or rent your space (sublease), you need permission of the BOD because you, as a shareholder) own nothing other than a right to occupy the space. The BOD can take out new mortgages or loans on your behalf and asses (pass on) all costs to you. Likewise the BOD can enter into all type of business arrangements and assess (pass on) the costs to shareholders. Shareholders have for all practical purposes very litle legal rights as the courts have for the most part given Boards carte Blanche. On top of this exiting a bad coop arrangement may be near impossible since any sale of shares requires Board approval, leaving the shareholder in a very unhappy and bad situation. You are basically in a permanent rental arrangement with no way out unless the landlord ( the Board) approves.

So which real estate transaction is best for you. Tough call.

Last edited by richrf; 05-23-2015 at 07:57 AM..
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Old 05-23-2015, 11:47 AM
 
9,957 posts, read 8,450,177 times
Reputation: 5835
^
You mean if I sell my coop for four times what I paid for it (which in this market, I could), I don't get to keep the money?

In point of fact most ownership apartments in NYC are coops (in Manhattan 75%). So if you want to buy something (and especially not in the multi million dollar price range, that's a lot of you choice.
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Old 05-23-2015, 12:09 PM
 
64,666 posts, read 66,158,228 times
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as most here can tell you i have made sooooooooooo much money in co-ops . they are excellent as investments.
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